Strategic Human Resource Management - Mello

CHAPTER 2: CHALLENGES IN STRATEGIC HUMAN RESOURCE MANAGEMENT Copyright © 2005 South-Western. All rights reserved.

Major Factors Affecting HRM

Technological Advancement

Demographics and Diversity

Strategic HRM

Globalization

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Exhibit 2-1

Issues for Integrating New Technologies

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Exhibit 2-2

Impact of Technology on Organizations

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Technology Challenges for HRM

• Telecommuting • Employee surveillance & monitoring

• e-HR • Ethical behavior

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Telecommuting • Dramatic growth in number of Americans working from home – 3.4 million in 1990 – 19.6 million by beginning of 2000

• Issues affecting success of telecommuting programs – Clear performance measurement system is key – Deciding which employees will be offered participation – Equipment expense – Some managers uncomfortable having direct reports away from office

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Employee Surveillance and Monitoring • More than 80% of large employers utilize monitoring technology, e.g., – – – – –

Internet usage E-mails Computer files Voice-mail Telephone usage

• Under Electronic Communications Privacy Act (ECPA), employees have only limited privacy rights Copyright © 2005 South-Western. All rights reserved.

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E-HR • Opportunity to deliver transactional types of services online: – – – – – –

Payroll Employee benefits Scheduling Recruiting Training Career development

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Ethical Behavior • Majority of jobs are considered to be “atwill” • Movement toward greater protection for employees in regard to off-duty behavior • Ownership of work • Fairness of noncompete clauses Copyright © 2005 South-Western. All rights reserved.

• Sarbanes-Oxley Act of 2002: – Seeks to eliminate deception in accounting & management practices by increasing government oversight – Holds senior executives more directly responsible for violations – Protects “whistleblowers” 1–9

Workforce Demographic Changes: “Graying” of Workforce • Negative aspects of older workers – Perceived resistance to change by older workers – Increased health-care costs for senior workers – Blocking advancement opportunities for younger workers – Higher wage and salary costs for senior workers Copyright © 2005 South-Western. All rights reserved.

• Positive aspects of older workers – As productive or more productive than younger workers – Have more organizational loyalty than younger workers – Possess broader industry knowledge and professional networks 1–10

Workforce Demographic Changes • Baby Boomers (1945–1962) – Currently in excess supply in middle management ranks – HR challenge is to manage “plateaued” workers

• Baby Busters (1963–mid-1970s) – Are often career bottlenecked by Boomers – Many have skills in high demand; are doing and will do well

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Workforce Demographic Changes • Generation “X”ers (late 1970s–early 1980s) – Have life-long exposure to technology and constant change – Seek self-control, independence, personal growth, creativity – Not focused on job security or long-term employment

• Generation “Y”: “Baby Boom Echo” (after 1979) – – – – –

High comfort level with technology Global and tolerant outlook on life Highly entrepreneurial Shorter attention span Opting for more transient and variable project work

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Workforce Demographic Changes • Sexual orientation – More than 200 Fortune 500 employers offer full benefits for domestic partners – Sexual orientation issues can impact bottom line

• Disabilities – 54 million Americans with disabilities – Often not included in diversity initiatives – Many supervisors do not understand needs of employees with disabilities – Stereotypes Copyright © 2005 South-Western. All rights reserved.

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New Employee/Workplace Dynamics • Emphasis on management of professionals – Establishment of separate career tracks • Technical/Professional, Managerial /Administrative

– Use of project teams

• Less employee loyalty, more loyal to self – Staying with employers for shorter periods; demanding more meaningful work and involvement in organizational decisions

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New Employee/Workplace Dynamics • Increased personal and family dynamic effects – More single-parent families, dual-career couples, & domestic partners

• Increased nontraditional work relationships – Part-time, consulting, and temporary employment flexibility – Outsourcing and entrepreneurial opportunities

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Ethnicity • In 2005:

• By 2025:

– Ethnic minority share of workforce roughly 28%

– African-Americans will represent 14% of population

• Up from 22% in 1990 and 18% in 1980

– Hispanics will represent 17% of population

• By 2050: – Close to 50% of US population will be non-Caucasian

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• Up from 12% in 1994

• Up from 10% in 1994

– Asians & Pacific Islanders will represent 8% of population • More than double from 1994 1–16

Managing Workplace Diversity • Understanding and appreciating diversity – Critical to effectively marketing to ethnic and minority groups – Promoted by having diverse workforce at all levels – Helps ensure hiring and promotion decisions are unbiased by personal differences

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• Diversity management programs or initiatives – Must be integrated with organization’s mission and objectives – Help key decision makers identify diversity’s benefits to organization – Make critical decisions about implementing optimal program/initiative contingent on organization and its people, mission and culture. 1–17

Exhibit 2-6

Individual Dimensions of Diversity

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Strategic Management of Diversity • Determine why diversity is important • Articulate how diversity relates to mission and strategic objectives • Define diversity and determine how inclusive its efforts will be • Make a decision as to whether special efforts should be extended to attract diverse workforce • Assess how existing employees, customers, and other constituencies feel about diversity • Determine specific types of diversity initiatives that will be undertaken Copyright © 2005 South-Western. All rights reserved.

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Reading 2.1 (Kirkman et al.)

Five Challenges to Virtual Team Success • Virtual teams: – Groups of people who work interdependently with shared purpose across space, time, and organization boundaries, using technology to communicate and collaborate

• Types of virtual teams – Global virtual teams – Teams assigned to accomplish specific projects – Cross-functional teams

• Challenge: Recognize obstacles confronting teams that are both cross-functional and virtual Copyright © 2005 South-Western. All rights reserved.

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Reading 2.1

Five Challenges to Virtual Team Success • Building trust within virtual teams • Maximizing process gains and minimizing process losses on virtual teams • Overcoming feelings of isolation and detachment associated with virtual teamwork • Balancing technical and interpersonal skills among virtual team members • Assessment and recognition of virtual team performance Copyright © 2005 South-Western. All rights reserved.

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Reading 2.2 (Starkman)

Impact of the Sarbanes-Oxley Act • New whistleblower protections – No public company may discriminate against an employee because of any lawful act – Retaliation against employee because of any lawful act done to assist a proceeding relating to alleged violation is prohibited – If DOL determines that violation has occurred, employer may be ordered to reinstate employee and provide compensatory damages

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Reading 2.2

Impact of the Sarbanes-Oxley Act • The Act dramatically affects officer compensation programs – Executive bonuses subject to forfeiture under Act – Personal loans to executives are regulated by Act – SEC can remove or temporarily freeze payments to executives and directors – Public accounting firms are precluded from auditing company if highly placed executive was employed by auditing firm and participated in company’s prior year’s audit – Attorneys have new rules of professional responsibility

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Reading 2.2

Impact of the Sarbanes-Oxley Act • The Act requires new employment policies and procedures – Procedures for receiving and handling complaints of corporate fraud have to be established – Compensation program bonus policies and stock option plans have to take account of new forfeiture provisions – Hiring and recruitment strategies and background checks will have to be revamped to avoid hiring executives whose employment is precluded by the Act – Training required to properly implement all of the Act’s mandates Copyright © 2005 South-Western. All rights reserved.

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Reading 2.3 (J. Schramm)

Employee Satisfaction • Potential impact of demographic changes – Aging population increases emphasis on health care benefits, retirement planning, and job security – Women are attaining higher proportion of professional qualifications – Future skills shortages may cause industrialized countries to compete for skilled immigrant labor

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• Industrial base shifting to service and health care sectors • Wider political and economic trends affecting job satisfaction – Health care costs – Job security – Pensions

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Reading 2.3

Employee Satisfaction • Two groups of issues: – Those depending on financial position of company • Benefits • Wages • Job security

– Those less costly to implement through changing practices, processes, and culture • • • •

Communication with management Work/life balance Employee’s relationship with immediate supervisor Career development

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